FRIENDLY FAMILY COMPETITION

LARRY STALCUP | Dec 01, 2008

Dale and Janice Good don't mind offering a little constructive criticism to each other. What couple married for more than 40 years wouldn't? And what's wrong with a little harmless friendly competition between spouses?

But their kitchen-table critiques aren't as common as most. The Goods question each other's moves in corn and soybean marketing — not particularly in real-life market trades, but those in MarketMaxx, the marketing game from Corn & Soybean Digest.

The Medina, OH, couple operates a small farm in the rolling hills region southwest of Cleveland. They live in a farm house they built in the 1960s near where Dale was raised.

MOST CORN AND SOYBEAN sales are to the local elevator. However, Dale often uses options in hopes of taking further profits out of the market.

His marketing skills were good enough to take second place in the 2006 MarketMaxx soybean marketing contest. He won a new computer system with software from Syngenta Crop Protection.

Janice has also often been in the top-10 leaderboard for MarketMaxx corn or soybeans. She got involved in grain marketing about 10 years ago. Dale had used futures and options off and on prior to that. And when he decided to look into new marketing seminars and classes offered by Farm Bureau, she joined him in the marketing training.

They began playing the MarketMaxx game when it started in 2004, and use the game to help enhance their real-life marketing skills.

Janice is like many other farm wives and female farm operators who have delved into crop and livestock marketing. And they're pretty good at it, says Steve Amosson, Texas AgriLife Extension economist, who has conducted the Texas A&M Master Marketer program more than 10 years.

“Women are often removed from much of the emotional attachment men have with the crop,” says Amosson. “They don't get attached to production. They see it as braces, eyeglasses or new furniture.”

Kim Anderson, Oklahoma State University Extension economist, points out that one of the major components of marketing is ego. “In general, women don't have as big of an ego,” he says. “Men are fearful that they will miss hitting the higher prices. Women fear hitting the lower prices.”

AS AN EXAMPLE, he says an acquaintance mentioned that her husband still had 2007 wheat in the bin. “I said, ‘you mean he didn't take $14/bu.,’” he says. “She said he was waiting for it to go higher.”

Meanwhile, Janice and Dale were within a few cents of each other on many MarketMaxx leaderboards the past three years. In mid-July this summer, she was fourth in the corn contest at $9.49/bu. Dale was fifth at $9.47.

Call option trades made by both helped them reach that elevated price, right in the middle of the huge summer rally.

“We've both studied a lot about the technical analysis when the markets change,” says Dale. “We try for sound fundamental analysis.”

Janice is learning more about chart reading to help know when to make a trade. “There are times that I'm hesitant to do anything,” she says. “I'm afraid, yet I know you need to do something. So rather than going for a home run, I often take a profit when I can and not be greedy.”

She says that while they are having fun playing against each other in the MarketMaxx games, where they can test their marketing skills using simulated sales of corn and soybeans, they also get serious about actual trades.

“As husband and wife, you have someone to pose your thoughts to and have a combined decision,” Janice says.

Brian Roe, Ohio State University agricultural economist, says the combined input into a marketing plan or other farm management decisions can be stressful, but can often pay off in the long run.

“There is a line of research that shows that on average, women tend to be more conservative decision-makers,” says Roe. “Specifically, when they formulate probabilities, they tend to underweight the probability of something that is nearly certain to happen.

“If something potentially negative is on the horizon, women tend to be more conservative. Men tend to be more overconfident,” Roe says.

He adds that with the high corn and soybean price run-up seen during the spring and summer, women marketers likely were more apt to have made grain sales than men.

“Again, women, on average, might have been more conservative and made more sales when prices reached high points,” says Roe. “Men might have waited longer because they saw even stronger markets.

“It's best to have inputs from both ends. Of course, having both parties look at a plan might be more difficult and stressful to manage, but it might help balance out the decision-making perspective,” he says.

ANDERSON SAYS WORKING simply to generate a profit should be considered by all farmers. “Growers need to establish some mechanical marketing strategies and not try to determine when the market is going to go up or down,” he says. “You need to know your cost of production and what your cash requirements will be.

“Women are more willing to accept the fact that you can't predict prices. They are more concerned about locking in a profit than missing higher prices,” Anderson says.

MarketMaxx enables growers and others to test and upgrade their corn and soybean marketing skills. Each player receives a simulated 100,000 bu. of corn and 50,000 bu. of soybeans to trade.

Chicago Board of Trade corn and soybean futures and options are used by players, as are cash sales and cash forward contracts. There is also old-crop and new-crop trading.

“If you're a producer, you're always ‘in the market,’” says Dale. “Playing MarketMaxx is a good way to learn how futures and options work without being out any money.”